Digesting Obama's Budgetary Kool-Aid

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Tue, 02/15/2011 - 13:19 | 963891 Robslob
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We are foocked

Tue, 02/15/2011 - 15:26 | 964430 Sudden Debt
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you mean faacked?

Tue, 02/15/2011 - 15:31 | 964457 Chuck Bone
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I think it's frelled.

Tue, 02/15/2011 - 23:25 | 965773 Zero Govt
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for the gullible its we're fooled

Tue, 02/15/2011 - 13:22 | 963901 Rainman
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The MSM will swallow all gubermint generated financial bullshit until one particularly large turd clogs their digestive system. This budget could be that turd.

Tue, 02/15/2011 - 13:22 | 963903 umop episdn
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Tyler, you are making this stuff up. There is no way these folks could possibly get away with lies this stupidly large.

the FY 2012 budget assumes a lower interest rate each and every year ranging from -18 bp in 2020 to -104 bp in 2013

This is as stupid as a central bank just printing money out of thin air. Oh, wait...

Tue, 02/15/2011 - 16:31 | 964707 hooligan2009
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hey if your name is an anagram of "upside down" where is the freaking "w"!!!! wait is it "pm on upside"...never mind heh

Tue, 02/15/2011 - 13:26 | 963906 buzzsaw99
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I fully appreciate that debt issued in today's low rate environment will still be outstanding in a couple years, keeping the rate low, however, given the average duration of our debt, it seems implausible the avg rates would stay low that long...

Not to me it doesn't. Everyone thinks rates are going up. Laughable.

Tue, 02/15/2011 - 14:13 | 964082 packman
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Ahem.  They're up 120bp in just the past 3 months (10-year was at 2.37, now at 3.60).

The fact that you think it's laughable is laughable.

Ask Greece, Spain, Portugal, Ireland, etc. etc. about the relationship of central bank lending rates and government borrowing rates.


Tue, 02/15/2011 - 14:47 | 964241 dbach
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>> $1.1 trillion in new bonds will be supplied to the market place next year

>> The credit worthiness of the US deteriorates accordingly (either through printing or default, the effect is the same)

Basic supply and demand seems to dictate prices going up, no?


Tue, 02/15/2011 - 13:26 | 963907 alexwest
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hey Tyler,
here's another topic in need to be duiscussed.. and not yet what is size of next debt limit?

if this year deficit only then its around +1.5/7 trln, so Obama has same problem next year by summer.. and dont forget next presiden elections is in oct 2012..

so it must be somehing to cover 1.5 year , so at least $2-2.2 trln to cover upto jan 2013..

so what is oil goona be in case of $ 2.2 tlrn debt limit ? what is 10yy yield gonna be?


Tue, 02/15/2011 - 13:32 | 963925 Tyler Durden
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We have discussed this extensively in the past. Next debt ceiling hike will be in December/January 2012.

Tue, 02/15/2011 - 13:28 | 963914 Rule of 72
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Part of the "fundamental transformation" of the country, doncha know.

I have questions for any of Obeyme's kool-aid drinkers left on ZH.  If Obeyme were trying on purpose to steer us into default and crash the economy, how would his budget be any different?  How can this budget not be considered to be a violation of his Presidential Oath of Office?

This is what happens when you elect a community agitator as President.  He ends up agitating the entire country.  I pray we can make it to January 2013 when this menace to society will be gone.

Tue, 02/15/2011 - 14:30 | 964157 karzai_luver
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there has not been anything close to a sane budget doc out of the WH in the last 30-40 years.


They all do it, the sums are larger now as the ponzi is in blow off mode.


No new admin is going to change it as the dims won't cut the welfare/pork and the pugs won't cut anything other than the welfare/pork which doesn't get you anywhere either.



They and the next one or two that manages to get elected while you still have elections are a joke and a fraud.


Upfront and for certain.


Foam at the mouth all you wish, you are too late the math no longer works which is why it is falsified or ignored.

this clown show has been fundamentally transformed for at least 30-40 years.


A lifetime of lying and criminal acts does eventually catch up to anyone , even a country.



Tue, 02/15/2011 - 16:30 | 964699 Rule of 72
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I agree it has been building for a long time.  We have had a credit-driven economy since at least the 70s.  However, Obeyme is on track to add as much debt in his first (and only) term as we had for the rest of the 43 presidents combined.  He had eclipsed Washington through Reagan in debt after just two years.

We are in uncharted waters with this clown in terms of debt.  We're being led by him to the destruction of our economy.  (Or what's left of it, since we don't make shit any more.)

Tue, 02/15/2011 - 13:30 | 963915 Alcoholic Nativ...
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Fuck Obama for going after domestic spending.  Profiteering is the problem. That huge transfer of wealth that just happend, the money is still there. It's sitting in some rich profiteering assholes bank account. Take it big brother! It's yours!

Tue, 02/15/2011 - 13:39 | 963922 Mercury
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I think our best chance to cut a big ticket item is defense.  here's my plan:

Cut defense in half and use the savings to pay down debt ONLY. 

Bring home as many soldiers from foreign posts as possible, including Germany and S. Korea. 

Then give these discharged soldiers (whose abilities and aptitude are above average compared to the general population in many previously measured ways) a generous amount of tax breaks and incentives to start businesses, go to school, engage in capital formation and generally be productive in the private sector.

Tue, 02/15/2011 - 13:42 | 963955 newworldorder
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Sound ideas but will not happen because, well they make sense.

We are on a run-away train, at full speed toward the great unknown. All train personnel have taken refuge in the last car and are working fevereshly to cut the car away from the train before disaster hits.

The passangers are comfortably asleep or partying on all night long.

Tue, 02/15/2011 - 13:51 | 963974 Mercury
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I'm no fan of the welfare state but I'm also well aware (as is Obama) that there really isn't a reverse gear in that sector (although it can/will crash).

At this point there is little in the way of national interest being served by having such a big footprint in S. Korea and Europe (let alone Iraq & Afghanistan).  We can patrol the high seas, maintain air dominance where necessary and more than provide for actual national defense with a much smaller expeditionary force and an honest to goodness don't-fuck-with-us-or-else policy.

Tue, 02/15/2011 - 14:47 | 964243 Bob
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It's a no-brainer.  Which is fortunate, maybe, because something like 67% of the population agrees. 

But then where will the War-Fear Complex get their money?

Tue, 02/15/2011 - 19:25 | 965237 Problem Is
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Bring them home and put them to work for the Army Corps of Engineers and the C.B's until their enlistments run out.

There are a lot of fire breaks and fire roads and levees to shore up across the country...

Tue, 02/15/2011 - 14:10 | 964070 HungrySeagull
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That last car to be cut requires everything Defense brought to the United States from around the world.

Then the excess manpower, material and logistics to be cut down.

Europe will scream. But let them take care of their own defense. The stans will fight it out themselves.

Hell, we can deploy two Corps (The 5th and the 7th for example) along the Mexican border, bring all the navy to the coast and patrol and the entire airforce with the drones and bombers can scan the Nation for invaders.


As the previous poster said, a Nation with a effective defense will be one left alone.


The rest of the budget is going to either kill the patient through septis or destroy the sewer system created to bamboozle the public into thinking no odor, no bull.

Tue, 02/15/2011 - 14:37 | 964195 karzai_luver
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screw you and your wet dream of a military police state.


If that's what it's come to then disband the whole crap shoot and start over.


Patrol the nation for invaders.


You pathetic fool, that's how they always start.



Tue, 02/15/2011 - 14:50 | 964256 Bob
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LOL.  We can just lay them off or buy out their contracts if that's what it takes.

Wed, 02/16/2011 - 01:56 | 965951 HungrySeagull
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We have millions of illegals over 30 years, we have a gang infrastructure that is at least a million and growing we have a society that no longer functions.

Wet dream is not.

Suicides will become a industry as common as suntan parlors when people cannot stand the life that they have. They can float away to oblivion without any pain or regret.

Eventually even the United States must itself be consumed by various Nations that have been steadly buying the place, lock stock and barrel.

You can say screw you to me all you want to until blue in the face.

But when you see bad things coming, you need to prepare as best as you can.

Everyone laughed and partied while Noah built the Ark.

We all know the rest of the story.

Back in the 50's we had a military capable of deploying 1500 fighter jets at a moment's notice to intercept anything anywhere anytime.


Today we can put up a few hundred at best and it will take time for most of them (Not supercruise like the F22 Raptor) to get to where they can do some good.


We fly drones over battlefields.


Now we fly drones over Miami and other places like the British wired London for Video and sound. Eventually there will be a drone watching you type to zero hedge telling me how I am experincing something that is not the case.


Not screw me, screw us all. We are fooked. And the problem is that shit has been wiped with so much empty words and speeches like plenty of wet and wild that we as a population actually like it and ask for more.

Tue, 02/15/2011 - 13:55 | 964003 Pants McPants
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Decent plan except for the last paragraph.  These soldiers have been feeding off of tax dollars their entire careers.  Why give them more breaks?  Let them find their own way in the US. 

Anyone with above average abilities and aptitude should have no problem finding a suitable career.  Bring em' back to the US, disarm them, and let them be on their way.

Tue, 02/15/2011 - 14:02 | 964036 Mercury
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-might be necessary to make the sausage and all in all,  handouts for Service personel irks me much less than for many others.  That's all.

Tue, 02/15/2011 - 14:04 | 964042 Pants McPants
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It's easy to compromise with other people's money.

But I get what you're saying.

Tue, 02/15/2011 - 14:09 | 964069 Mercury
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Well ultimately it's our money that's at stake here and that's why we're all worked up about it.

Tue, 02/15/2011 - 14:23 | 964123 NOTW777
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you go take their place

Tue, 02/15/2011 - 14:24 | 964134 Pants McPants
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Um, no.  I'm not interesting in "defending" the US in any of the BS wars.

Tue, 02/15/2011 - 23:34 | 965791 Zero Govt
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you've just saved £18 Trillion in military-industrial complex spending, any chance you running for President?

Tue, 02/15/2011 - 14:16 | 964100 MiddleMeThis
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There is simply too much big business (and money to be made) in the Defense Industry.  By drastically cutting the budget, you cut the profits of the Corporations that run our government; it'll never happen.

Tue, 02/15/2011 - 14:42 | 964220 Mercury
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We could have fewer soldiers and more gear.

Tue, 02/15/2011 - 14:34 | 964173 karzai_luver
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sorry, last I heard the returning "heroes" of the guard were facing around a 30% jobless rate.


I guess to pick up the worthless teat sucking scum line that is all the rage around these here parts, that would include this bunch of worthless service men and women?


I mean there are plenty of jobs and we know the best and brightest would want to do anything to have one of them!


Right Ironhead?

Tue, 02/15/2011 - 14:57 | 964296 Mercury
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Thus the incentive part of the plan.

Tue, 02/15/2011 - 14:46 | 964234 karzai_luver
karzai_luver's picture

You are in la-la land.


The vast bulk of the regular types have been stripped of anything approaching entrepreneurial skills.


They are your burden now. You made them now support them.


Most of them went into the lower rungs of the service because they couldn't cut it outside, that's the painful truth.


Another round of college educated clowns is not going to do anything to dig this thing out of the ditch.


There are millions of them now who can't find a job worth the money they blew toward college.


Making several millions more with magic bucks is just more of the same old failed crap.




Tue, 02/15/2011 - 14:59 | 964307 Bob
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Interesting argument.  Defaulting on our heroes who have defended democracy in the service of their Country is not a political possibility.  It does sound ridiculous when you put it in those terms, though, doesn't it?

Tue, 02/15/2011 - 14:58 | 964300 ARW
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Cut defense in half and use the savings to pay down debt ONLY. 


I'm sorry but this is stupid. We're running $1.5T yearly defecits and you think $350B (1/2 of $700B) is gonna retire, much less reduce, our debt? And you think it'spossible to put the $350B into a debt reduction lock-box?



Tue, 02/15/2011 - 15:15 | 964368 Mercury
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 I don't think it's the optimal solution but it might be the most feasible.  There are a limited amount of big ticket items.  If you think there's a way to dismantle a million little entitlements (or even one big one) go for it.

Tue, 02/15/2011 - 17:33 | 964961 ARW
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My point is that cutting defense by 50% is no solution at all.


Tue, 02/15/2011 - 15:13 | 964369 Mercury
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Tue, 02/15/2011 - 15:12 | 964370 Mercury
Mercury's picture


Tue, 02/15/2011 - 13:41 | 963948 sbenard
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Unctuous Obama! Not one syllable from his lips can be believed!

Tue, 02/15/2011 - 13:47 | 963971 jobs1234
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"I fully appreciate that debt issued in today's low rate environment will still be outstanding in a couple years, keeping the rate low, however, given the average duration of our debt, it seems implausible the avg rates would stay low that long..."


Thats the flaw in these assumptions - the assumption is that there will be no inflation and thus no need to raise rates, or raise them at a rate designed to slow inflationary pressures.

I dont even want to fathom what would happen if they had to raise rates.

Tue, 02/15/2011 - 13:53 | 963985 daybyday
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what happens when 30 year bonds trade par because qe 1,2,3,4,5,6,7,8 and inflation is ragging

Tue, 02/15/2011 - 13:54 | 963999 GottaBKiddn
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Ben inflates the currency, while the govt. takes it out of domestic circulation. So the prices rise, but there is less currency available to the public. So, while budget cuts are excellent on their face, they will only hurt the public and actually won't make a dent in our bankruptcy. So they can only be explained as political circus to mask the rape. Which is why they don't teach this stuff in school.

Tue, 02/15/2011 - 15:44 | 964385 Bob
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They've got to sucker us into taking emotional ownership of the cuts.  First, we have to be led to accept that their necessity is unquestionable and effectively flattered by assurances that we'll prove ourselves to be Big Boys and Girls by giving in.  Extra credit given to those who really invest themselves in the proprosition and cheerlead others into buying it.  CNN is proving itself a real Star these days, btw.

Later, when we find out we've been raped, we'll feel like it's our fault.  Like a molested child seduced by a saavy pervert who played "Do you want me to" every touch of the way or a woman who was wearing a short skirt and froze when she was thrown to the ground by an unarmed rapist. 

Needless to say, the cheerleaders won't want everybody looking at them when things go bad, so they'll point fingers at the victims who complain and mock them for thinking and feeling like victims. 

But at least the rape will be able to continue for a few extra years while the poor and middle class enjoy a nice, long gang bang. 

Until enough people lose their cable and cell phones, in addition to growing homelessness.  Then all bets are off.

Tue, 02/15/2011 - 14:24 | 964132 NOTW777
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us still makes plenty of koolaid

Tue, 02/15/2011 - 14:47 | 964244 Clampit
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The first two charts look like deck chair maps ...

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